Retail Toolkit

Retail KPI dictionary: definitions and formulas

Plain definitions and formulas for the retail metrics that appear in Asian earnings calls, investor decks and operating reviews, with notes on how each one is commonly misused.

Guide 2 of 9 · 8 min read · Updated 1 August 2026

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Retail metrics are defined loosely enough that two companies can report the same number and mean different things. This dictionary gives one workable definition per metric, the formula, and the most common way it gets bent.

Sales and demand

Metric	Formula	Watch for
Like-for-like sales	Sales from stores trading both periods ÷ prior period	Which stores qualify, and whether e-commerce is included
Gross merchandise value	Total value of orders placed	Includes cancellations and returns unless stated
Average transaction value	Net sales ÷ transactions	Rises with price increases as well as basket growth
Units per transaction	Units sold ÷ transactions	The cleaner read on basket building
Conversion rate	Transactions ÷ visitors	Footfall counting method changes the denominator

Margin and inventory

Metric	Formula	Watch for
Gross margin	(Net sales − cost of goods) ÷ net sales	Whether inbound freight sits in cost of goods
Markdown rate	Markdown value ÷ gross sales	Promotional funding from suppliers can mask it
Sell-through	Units sold ÷ units received	Only meaningful with a stated time window
Inventory turns	Cost of goods ÷ average inventory at cost	Average of two points hides seasonal peaks
Weeks of cover	Inventory ÷ average weekly sales	Forward-looking version is far more useful
Shrinkage	Stock loss ÷ net sales	Includes admin error, not only theft

Store productivity

Metric	Formula	Watch for
Sales per square metre	Net sales ÷ trading area	Trading area versus gross leased area
Contribution per square metre	Four-wall contribution ÷ trading area	The honest version of the above
Occupancy cost ratio	Total occupancy ÷ net sales	Service charge and marketing levy must be included
Sales per labour hour	Net sales ÷ hours worked	Excludes stockroom hours in some definitions

E-commerce and customer

Metric	Formula	Watch for
Customer acquisition cost	Acquisition spend ÷ new customers	Whether discounts count as spend
Repeat rate	Customers with 2+ orders ÷ customers	Depends entirely on the window chosen
Contribution margin per order	Revenue − goods − fulfilment − payment − returns	Return cost is frequently omitted
Return rate	Returned units ÷ shipped units	Splits sharply by payment method in COD markets
First-attempt delivery rate	Delivered first try ÷ attempted	The core last-mile health metric in the region

Key takeaways

Define the comparable-store rule before quoting like-for-like sales.
Gross merchandise value is a demand measure, not revenue.
Contribution per square metre beats sales per square metre for every real decision.
In cash-on-delivery markets, always report returns split by payment method.

Questions & Answers

Which metrics belong in a monthly operating review?

A short set: like-for-like sales, gross margin after markdown, occupancy cost ratio, weeks of cover, and contribution per square metre. Everything else is diagnostic and belongs in the appendix.

Why do reported e-commerce margins differ so much between companies?

Mostly because of where fulfilment, payment fees and returns sit in the P&L. Compare contribution margin per order where it is disclosed, and treat headline gross margin as non-comparable.